Written answers

Tuesday, 22 November 2016

Department of Public Expenditure and Reform

Pension Provisions

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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353. To ask the Minister for Public Expenditure and Reform the policy on the unwinding of cuts imposed on public service pensioners under the financial emergency measures in the public interest, FEMPI, legislation; and if he will make a statement on the matter. [35767/16]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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In June 2015, Government approved proposals for a significant adjustment of the public service pension reductions (PSPR) which had been applied to all public service pensions above specified thresholds under the Financial Emergency Measures in the Public Interest (FEMPI) legislation. The approved proposals, which subsequently were enacted through the FEMPI Act 2015, provide for changes to occur in three phases, on 1 January 2016, 1 January 2017 and 1 January 2018.

On 1 January 2016, increases in the exemption thresholds for PSPR application were activated. These exemption threshold increases fully removed PSPR from a significant number of pensions with relatively lower values, while those pensions which continue to be impacted by PSPR received a boost of €400 per year.

On 1 January 2017, additional PSPR adjustments, acting principally via further exemption threshold increases, will fully remove PSPR from another significant tranche of public service pensioners, while at the same time boosting those pensions which remain affected by PSPR, in most cases, by €500 per year.

On 1 January 2018, the third phase of PSPR adjustment will ensure that all PSPR-impacted pensions with values up to €34,132 will be fully restored, meaning that PSPR will no longer affect such pensions, while those pensions which continue to be impacted by PSPR will get a boost of, in most cases, €780 per year.

These phased PSPR changes across the public service will cost an estimated €90 million on an annual basis and, when fully implemented, will ensure that only the top 20% higher value public service pensions will continue to be impacted by the PSPR.

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